Singapore, 29 July (Argus) — India estimates its current coal reserves at 267.2bn t, but more than half this amount is only indicated reserves as consumers increasingly turn to imports to meet a demand shortfall.
Of the total, only 39.6pc, or 105.82bn t, is proven reserves, which India's coal ministry said is adequate to meet the country's projected demand. But steel mills still import coking coal because of limited availability, it said, with power plants also buying from abroad because of environmental regulations or a domestic shortfall.
Jharkhand in the east of the country is India's most coal-rich state with 76.7bn t, of which 51.5pc are proven reserves. Orissa, also in east India, has estimated total coal reserves of 65.2bn t with 30.6pc being proven. Chhattisgarh, in central-east India, has total reserves 44.5bn t, but only 24.5pc are proven reserves and the remaining 75.5pc are indicated reserves.
Other Indian states with significant reserves include West Bengal, Madhya Pradesh, Andhra Pradesh and Maharashtra with total reserves estimated at 28.3bn t, 21bn t, 18.9bn t and 10.2bn t respectively.
But India is stilling expecting a short-term coal shortage. State-owned coal producer Coal India (CIL) expects to produce less coal than earlier estimates, forcing it to import more to supply the country's growing number of power plants. Power plants account for almost 75pc of CIL's customers.
CIL expects to produce 486mn t of coal in the 2011-12 fiscal year, below an earlier estimated 520mn t. India is targeting domestic coal output to hit about 630mn t in 2011-12, up from 571.9mn t in 2010-11. CIL will be the biggest contributor, while fellow state-owned Singareni Collieries is targeting 47mn t in 2011-12 and output from other Indian producers forecast to be 96.4mn t. But Indian demand is forecasts at 721mn t for 2011-12, prompting the increased imports.
A number of Indian independent power producers, including Tata Power, Essar Power and Reliance Power, have already acquired stakes in overseas coal mines because of the need for more imports.
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